ToolNestFree Rental Yield Calculator
Last updated: October 23, 2026
Quick answer: Rental yield tells you what a property actually earns you each year as a percentage of what you paid for it — the single number investors use to compare two listings in seconds. This free rental yield calculator goes beyond the headline figure: enter the purchase price and monthly rent, add your operating expenses (property tax, insurance, HOA, maintenance, vacancy, and management), and it computes the gross rental yield, the cap rate (yield on net operating income), your monthly cash flow after the mortgage, and your cash-on-cash return — plus a verdict on the classic 1% rule. Financing is built in, so you see the deal the way your bank account will. Everything runs in your browser: your numbers never leave your device.
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Estimates only — not financial advice. This is a screening tool, not a substitute for full due diligence, local tax advice, or a professional appraisal.
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How to Use the Rental Yield Calculator
- Enter the purchase price and the monthly rent you expect to charge — those two numbers set the gross yield.
- Add your financing: down payment, mortgage rate, and loan term. The calculator turns these into a monthly payment automatically.
- Fill in the operating expenses: annual property tax and insurance, monthly HOA, and maintenance, vacancy, and management as percentages of annual rent. The 5/5/8 defaults are common starting points.
- Read the four headline numbers: gross yield, cap rate, monthly cash flow, and cash-on-cash return — plus the 1% rule verdict.
- Tweak one input at a time (try a higher rent or a lower purchase price) to see which lever moves the deal most.
Why Use Our Rental Yield Calculator?
- Four metrics in one pass — gross yield, cap rate, monthly cash flow, and cash-on-cash return, so you see the deal from every angle at once.
- Full expense stack — property tax, insurance, HOA, plus maintenance, vacancy, and management as percentages of rent: the costs beginners forget.
- Mortgage math built in — down payment, rate, and term become a real monthly payment, so cash flow reflects what your bank account will see.
- 1% rule verdict — instantly flags whether monthly rent hits 1% of the purchase price, the classic investor quick-screen.
- Gross vs. net, side by side — the gap between gross yield and cap rate shows exactly how much of the rent the expenses eat.
- Private by design — all math runs in your browser; your deal numbers never leave your device.
Common Use Cases
- Screening listings in seconds: Paste the asking price and estimated rent from any listing into the calculator and get a gross yield before you read the description — skip the duds without opening a spreadsheet.
- Comparing two properties: Run the same expense assumptions on two competing deals; the cap-rate and cash-on-cash gap tells you which one actually performs, not just which rents for more.
- Evaluating out-of-state turnkeys: Turnkey providers quote gross yields. Add realistic vacancy and management percentages to see the net picture before you wire earnest money across the country.
- Deciding on a rent increase: Model the new rent against the same expenses: the yield and cash-flow delta shows exactly what the increase is worth per year.
- Refinance check: Drop your current rate into the mortgage field, then the refinance quote — the monthly cash-flow difference is your payback math, no spreadsheet needed.
- Back-solving your maximum offer price: You want an 8% gross yield and the property rents for $2,200/month: $2,200 × 12 ÷ 0.08 = $330,000 is your ceiling. Offer above it and the yield math fails your own rule; offer below it and you have margin. Run the target yield backward before you negotiate, not after you fall in love with the property.
- Ranking a five-listing shortlist: Five listings, five asking prices, five rent estimates — run all five through the calculator with identical expense percentages and rank by cap rate and cash-on-cash, not by rent. The highest-rent listing usually loses once taxes and HOA are in, and the ranking is the offer order.
- Screening a house-hack: You will live in one unit and rent the others: enter the full purchase price but only the other units' rent, and read cash flow against the full mortgage. If the other units nearly cover the payment, the house-hack works; if they cover half of it, you are buying an expensive primary residence with a rental hobby attached.
Rental Yield Calculator vs Alternatives
- BiggerPockets calculators: The gold standard for serious investors — deep underwriting with renovation budgets and long-term projections. They require a free account and are built for logged-in workflows; ours gives you the four headline numbers instantly with no account.
- Zillow / Redfin rent estimates: Excellent for estimating market rent from comparable listings — that input feeds our calculator. But they estimate rents; they don't compute your yield, cap rate, or cash flow.
- Calculator.net-style calculator sites: The math is correct, but the pages are ad-heavy and slow on mobile, and most stop at gross yield. This page adds the expense stack, financing, and cash-on-cash on one clean page.
- Your own spreadsheet: If you underwrite deals weekly, a spreadsheet you built and trust is the source of truth — keep it. This calculator is the fast, honest screen you run before a deal earns a row in that spreadsheet.
- Roofstock / marketplace yield badges: Marketplace listings often badge a gross yield computed from marketing rents with no expense stack — the same 8.8% headline this page's net figure corrects to 5.5%. Use the badge to find deals, then re-run the numbers here with real taxes, vacancy, and management before you bid.
- Agent pro formas: An agent's pro forma is a sales document: rents at the top of the range, vacancy often at 0%, management sometimes omitted entirely. It is useful as a source of the inputs — price, tax, HOA — but the yield it prints is the optimistic case. Recompute it here with your own vacancy and management assumptions and you will see the deal as it actually pencils.
If you're underwriting full deals every week, keep your spreadsheet — it's your source of truth, and BiggerPockets' suite is the deepest free option. For a fast, honest screen of any listing with the four numbers that matter and no account or ads, this page is the quickest check you'll run.
Frequently Asked Questions
What is a good rental yield?
In the US, gross rental yields of 6–10% are commonly considered decent, with 8%+ often cited as a healthy target — but 'good' is local. A 7% yield in a slow-appreciation market can beat a 5% yield in a fast-appreciation one once equity growth is counted. Use the cap rate and cash-on-cash figures alongside gross yield before judging a deal.
How do you calculate rental yield?
Gross rental yield = (monthly rent × 12 ÷ purchase price) × 100. Example: a $300,000 property renting for $2,200/month gives ($2,200 × 12 ÷ $300,000) × 100 = 8.8% gross yield. This calculator does that math, then goes further: it subtracts your operating expenses to get net operating income and the cap rate.
What is the difference between rental yield and cap rate?
Gross rental yield divides annual rent by the purchase price and ignores every expense. Cap rate divides net operating income (rent minus operating expenses, before mortgage payments) by the price — so it's the yield on what the property itself earns. Cap rate is the number serious investors compare across properties; this page shows both.
What is the 1% rule in real estate?
The 1% rule says monthly rent should be at least 1% of the purchase price ($3,000/month on a $300,000 property). It's a fast screening rule, not a law — in expensive coastal markets almost nothing passes it, while in cash-flow markets it's a minimum bar. The calculator shows your rent-to-price ratio and flags where you stand.
Does rental yield include mortgage payments?
Gross yield and cap rate do not — they're property-level metrics, independent of how you finance. But your actual return absolutely depends on the loan, which is why this calculator also shows monthly cash flow (after the mortgage payment) and cash-on-cash return (cash flow ÷ cash invested). A property can have a fine cap rate and negative cash flow if it's over-leveraged.
How can I increase my rental yield?
The levers are: raise rent toward market rate, cut vacancy with better tenant screening, reduce management costs (self-manage), trim maintenance with preventive upkeep, refinance to a lower rate, or simply buy below market. Plug each scenario into the calculator — you'll usually find that purchase price and rent move the yield far more than shaving a point off expenses.
What is the difference between gross yield and net yield?
Gross yield ignores every cost: $2,200/month on a $300,000 property is 8.8% gross. Net yield subtracts the expense stack first. With $3,600 tax, $1,500 insurance, 5% maintenance ($1,320), 5% vacancy ($1,320), and 8% management ($2,112) — $9,852 a year — net operating income is $26,400 − $9,852 = $16,548, so the net yield (and the cap rate, which is the same ratio) is 5.5%. The 3.3-point gap between gross and net is the number that sinks deals bought on the headline figure alone.
What is a good cap rate?
For US residential property, 4–10% covers most markets: 4–5% is normal in expensive coastal cities where appreciation does much of the work, 8%+ is the expectation in cash-flow markets. Judge a cap rate against what else your money could earn — a 5% cap rate with 3% appreciation is a different deal from a 5% cap rate with flat prices — and against the risk: a high cap rate in a declining town can be a value trap, not a bargain.
Does rental yield include property appreciation?
No — yield is income only. Total return is yield plus appreciation minus costs: a 5.5% net yield plus 3% annual appreciation is roughly an 8.5% total return before financing costs, while a 5.5% yield in a flat market is just 5.5%. Never let a seller's pitch add appreciation into the yield figure; run the yield on rent alone, then judge appreciation as a separate, uncertain bet.
How does vacancy change the yield?
Through effective gross income: rent × (1 − vacancy rate). At 5% vacancy, $2,200 of headline rent is $2,090 of effective rent, and every yield figure downstream drops by the same 5%. Turnkey sellers who quote yields at 0% vacancy are overstating income by exactly their vacancy assumption — put your market's real vacancy rate (5–8% in most US markets) into the calculator before you believe any quoted yield.
Should closing costs count in the purchase price for yield?
Yes, for a true yield: you paid them, so they are part of the investment. A $300,000 purchase with $9,000 of closing costs is a $309,000 investment, and the gross yield on $2,200/month falls from 8.8% to 8.5% ($26,400 ÷ $309,000). The difference is small on one deal and decisive when two deals are close — use the all-in cost when you compare, not the listing price.
Can I use this calculator for a short-term rental?
Not as-is — this tool models long-term monthly rent. Short-term rentals can gross two to three times a long-term rent, but cleaning fees, platform fees, furnishing, utilities, and much higher vacancy compress the net far below the gross, and the expense stack is a different shape entirely. Use the long-term figures here as your floor: if a property fails as a long-term rental, its short-term case has to clear a much higher bar to be worth the extra work.